Ghost Floors: Why Billionaires Buy Apartments They Never Visit

Dark towers punctuate city skylines worldwide, their empty floors not failures but features of a hidden financial ecosystem. These gleaming skyscrapers in places like New York's Billionaire's Row, Dubai, Hong Kong, and Toronto serve a purpose far removed from conventional housing: they function as "safe deposit boxes in the clouds" for the ultra-wealthy.

When you look up at night and see those unlit floors in luxury buildings, you're witnessing a global wealth preservation strategy in action. These properties aren't meant to house people—they're designed to store capital. For billionaires seeking security, anonymity, and prestige, purchasing a multimillion-dollar apartment they'll never visit makes perfect financial sense. The sources reveal that in some buildings, over 60% of units remain perpetually empty, serving as quiet vaults for international wealth.

Each empty tower tells a slightly different story. In New York, it's about parking money in a stable asset beyond certain regulatory oversight. Hong Kong's dark floors often conceal wealth from mainland Chinese elites avoiding anti-corruption scrutiny. Dubai's vacant luxury apartments signal global status—the ownership itself sends a message of success, no occupancy required. Meanwhile, Toronto's market thrives on speculation through "assignment sales," where units change hands multiple times before anyone takes possession.

The advantages are compelling: privacy through complex ownership structures, potential tax benefits, pathways to foreign residency or citizenship, and the undeniable prestige of owning trophy properties. For developers and local governments, these projects boost GDP and attract investment without the complications of actual residents. The emptiness isn't the problem—it's the point. Next time you see those darkened windows high above the city, don't wonder who lives there. Ask instead: whose money is hiding there?

📰 Read more about this topic in our latest article:  https://sunrisecapitalgroup.com/why-so-many-luxury-skyscrapers-are-empty-the-hidden-economics-of-global-real-estate/

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Episode Transcript

Speaker 1 (00:00):
Okay, let's jump into this deep dive.
We've got quite a stack herearticles, research, notes and
they're all pointing towardssomething, well frankly, a bit
strange happening in cityskylines.

Speaker 2 (00:14):
Yeah, all over the world really, you think New York
, Dubai, even Toronto.

Speaker 1 (00:19):
Exactly, and you picture those skylines right At
night they're glittering.
But, then you look closer andyou see these pockets of
darkness.

Speaker 2 (00:26):
Whole floors sometimes, or even entire
buildings that just look empty.

Speaker 1 (00:30):
It is a striking image, isn't it?
These huge symbols of wealthand progress just sitting there,
dark.

Speaker 2 (00:36):
And your first thought, naturally, is that
they're vacant because maybe theproject failed or they're
waiting for tenants.

Speaker 1 (00:43):
That's what you think A flop, basically.
But the material we've beendigging into it paints a totally
different picture.

Speaker 2 (00:49):
Completely different.
It suggests this emptiness.
It's not a bug, it's a feature,it's actually intentional.

Speaker 1 (00:55):
Intentional.
These buildings are serving apurpose, often a hidden one.

Speaker 2 (00:59):
And that purpose?
Well, it's not really abouthousing people or running
offices, not in a way wenormally think about it.
It's something else.

Speaker 1 (01:06):
So that's our mission here, right To kind of peel
back those layers.
We want to figure out why buildthese massive, expensive towers
if people aren't living orworking in them.

Speaker 2 (01:14):
Who's buying these places, these
multimillion-dollar apartments?

Speaker 1 (01:18):
And what are they really being used for?
Because it feels like it's lessabout, you know, bricks and
mortar and more about somethingmuch more abstract.

Speaker 2 (01:26):
Well, let's get straight to that core idea.
The sources really hammer home.
They describe these towers notreally as homes or condos, but
as well something quitedifferent.

Speaker 1 (01:36):
Yeah, one source had this phrase that really stuck
with me New safe deposit boxesin the clouds.

Speaker 2 (01:41):
Wow, that paints a picture.

Speaker 1 (01:44):
Doesn't it Not housing Wow, that paints a
picture, doesn't it Not housingStorage, but not for your, you
know, gold bars or importantpapers.

Speaker 2 (01:51):
For wealth itself.
The argument is that ultraluxury real estate has become
this preferred kind of vault.

Speaker 1 (01:57):
Exactly A vault for billionaires, maybe looking for
security, for anonymity, maybeeven for prestige.

Speaker 2 (02:03):
OK, but how does that work?
How is an apartment like a safedeposit box?
Usually you use property rightor rent it out.
How does just owning it actlike a vault?

Speaker 1 (02:18):
Well, the sources lay out a few key factors, and New
York City is a prime example.
A lot of the focus is on 57thStreet in Manhattan.
You know Billionaire's Row.

Speaker 2 (02:23):
Yes, billionaire's Row, those super tall,
incredibly skinny towers like432 Park Avenue, central Park
Tower.

Speaker 1 (02:32):
Those are the ones and the sources.
They flat out say these placeswere never intended as houses
per se.
They function more like well,like upright vaults.

Speaker 2 (02:41):
Upright vaults and the occupancy or lack thereof.

Speaker 1 (02:45):
Well, the numbers are pretty startling.
The sources suggest that wayover 60% of the units in some of
these buildings are eitherunsold or just sit empty for
months, even years.

Speaker 2 (02:55):
So it's not just a pied-à-terre situation like a
place someone uses occasionallywhen they're in town.

Speaker 1 (02:59):
It doesn't seem like it.
No, it's just empty, becausethe motivation, according to
this analysis, isn't livingthere.
It's not even about rent.

Speaker 2 (03:05):
It's about parking money millions of dollars in an
asset that feels stable, safefrom market swings.

Speaker 1 (03:11):
Or political risks maybe, or even just regulatory
oversight they want to avoid.

Speaker 2 (03:14):
Right, so they buy it and it just sits quietly.

Speaker 1 (03:18):
OK, so wealth preservation, storage, that's a
big driver.
But then if we shift focus, say, to Hong Kong, the sources
point to something similarvisually, you know, luxury
towers with those black floorsat night.

Speaker 2 (03:32):
But the emphasis there, according to the material
, is slightly different.
It's more about secrecy.

Speaker 1 (03:36):
Egracy, how so.

Speaker 2 (03:38):
Well, the sources describe these units as secret
wealth havens, especially, itseems, for elites from mainland
China trying to keep assets outof sight, away from
anti-corruption drives, forinstance.

Speaker 1 (03:51):
Interesting.
So even if laws are tightening,the suggestion is enforcement
might be.
Well, spotty is the word used.

Speaker 2 (03:57):
And here's a fascinating twist in the
analysis.
One source argues that the morepolitical pressure there is
back home, the more valuablethese unobserved financial
havens become.
Exactly the risk itself drivesup the demand for this kind of
hidden storage.
It's not about income, it'sabout invisibility.

Speaker 1 (04:12):
And the emptiness helps with that right.

Speaker 2 (04:13):
Yeah.

Speaker 1 (04:13):
Less activity, less attention drawn.

Speaker 2 (04:15):
Precisely Now, let's hop over to another famous
skyline Dubai.

Speaker 1 (04:19):
Right.
Dubai, known for pure opulence,home of the Burj Khalifa,
world's tallest building, andapparently it has a high
residential percentage,something like 77%.
You'd think it's full.

Speaker 2 (04:31):
You would think.
But the sources say nope, lotsof units there are also
permanently empty.

Speaker 1 (04:36):
So if it's not primarily about living there,
what's the driver in Dubai'smarket?

Speaker 2 (04:41):
The analysis suggests it's heavily driven by
perception, creating a globalprestige image.
It's less about filling theunits day to day.

Speaker 1 (04:51):
So for the buyers maybe foreign investors, perhaps
from emerging economies owninga condo, there is like a status
symbol.

Speaker 2 (04:58):
Yeah, it sends a message of success and
international presence, justowning an address in the Burj
Khalifa, for example.

Speaker 1 (05:04):
And crucially, the point is made that the message
does not need switches to beflipped or beds to be made.

Speaker 2 (05:09):
The message is sent just by owning it.
It doesn't need to be lived into signal that global
achievement.
The value is in the address theasset's identity, not its use
as a home.

Speaker 1 (05:20):
It really shows how detached value can become from
actual utility.

Speaker 2 (05:24):
And it's not just these huge global hubs, is it?
The sources also pull inToronto.

Speaker 1 (05:28):
Right.
Toronto, a city maybe knownmore for conventional growth,
but the same pattern seems to beplaying out.

Speaker 2 (05:36):
Massive development.
You mentioned the figure over1.3 million units being built.

Speaker 1 (05:40):
Yeah, huge numbers, and alongside that, surging
vacancy levels, especially againin that luxury sector.

Speaker 2 (05:48):
And the sources argue , it's not just that they built
too many, there's this otherfactor speculation flipping.

Speaker 1 (05:54):
Also called assignment sales.

Speaker 2 (05:55):
Yeah.

Speaker 1 (05:56):
Can you break that down quickly?

Speaker 2 (05:57):
Sure.
So basically, someone agrees tobuy a condo unit from the
developer, often before it'seven built Right, but they have
no intention of living there oreven closing the deal themselves
before it's even built Right.
But they have no intention ofliving there or even closing the
deal themselves Before theyactually have to take possession
.
They sell the contract, theright to buy that unit, to
someone else.

Speaker 1 (06:13):
For a profit, presumably.

Speaker 2 (06:14):
Hopefully yes, and that second buyer might do the
same thing, sell the contract onagain.
The sources say units can bebought and sold several times
over without ever takingpossession.

Speaker 1 (06:24):
Wow, so it's pure speculation on price increases.

Speaker 2 (06:33):
The physical apartment is almost irrelevant,
it's just the vehicle for thebet and the forces do note this
has actually triggered moneylaundering investigations in
Toronto Right and constructionkeeps going, the argument goes,
because the demand isn'tnecessarily from families
needing homes.
But from these unknowninvestors with cash to park who
are happy playing thisspeculative game.

Speaker 1 (06:47):
Which, I guess, brings us back to that core
question, that seemingillogicality why pay millions,
tens of millions for a place younever set foot in?

Speaker 2 (06:56):
It makes no sense if you think of real estate as just
a place to live or even rentout.

Speaker 1 (07:02):
But the sources argue this ultra luxury property, it
plays this whole other role forthe super rich in today's global
economy.

Speaker 2 (07:09):
Yeah, they outline several key functions, really
things that make it veryattractive as a place to park
capital, not people.

Speaker 1 (07:15):
OK, let's take through them First wealth
concealment how does that work?

Speaker 2 (07:19):
Well, the ownership structure, the sources explain
you can set it up using layersof offshore shell companies.
Nominee directors makes tracingthe real beneficial owner back
well, virtually untraceable,powerful privacy.

Speaker 1 (07:32):
Got it Okay.
Then there's tax avoidance.
How does property help there?

Speaker 2 (07:37):
It depends heavily on the specific country and city,
of course, but the sourcesmention possibilities like maybe
lower property taxes if a placeis vacant, potentially no
inheritance tax when it's passedon, sometimes no capital gains
tax when it's sold it can bemuch more tax efficient than
holding other types of assets.

Speaker 1 (07:55):
Right and another one benefits of citizenship.

Speaker 2 (07:59):
Yeah, this is interesting.
In some countries Portugal andthe UAE were mentioned as
examples making a large enoughreal estate purchase can
actually expedite residency oreven citizenship.

Speaker 1 (08:10):
So buying the condo isn't just about the asset
itself.
It's a potential pathway to anew residency or passport.

Speaker 2 (08:15):
Exactly, it's another layer of value.
And then, finally, there's whatthey call prestige asset
parking, just the sheer statusof owning certain properties.
You know, a penthouse onBillionaire's Row, a suite in
the Burj Khalifa.
These carry immenseinternational prestige.

Speaker 1 (08:30):
More so, perhaps, than just having the equivalent
cash in a bank.

Speaker 2 (08:34):
For some individuals.
Yes, it's a more visible, maybeeven perceived as a more stable
statement of global standing.

Speaker 1 (08:40):
So the sources are pretty clear.
Then, for these specific buyers, the apartment itself doesn't
need to do anything functional.

Speaker 2 (08:47):
It just needs to exist, be stable, be quiet,
hopefully go up in value.

Speaker 1 (08:53):
It's not an accident, it's a strategy, part of
international wealth planning.

Speaker 2 (08:56):
Which leads us right to the conclusion that keeps
coming up in the material thesetowers are essentially empty by
design.

Speaker 1 (09:04):
It's their answer to that very common, very
understandable question why arewe building empty skyscrapers
when so many people needaffordable housing?

Speaker 2 (09:13):
And the sources say look, that question, while valid
socially, utterly misses thefundamental reality of these
specific buildings.

Speaker 1 (09:20):
They're not built for residents.

Speaker 2 (09:22):
They're built fundamentally to accommodate
capital.

Speaker 1 (09:24):
And the sources touch on why authorities, might you
know, let this happen or evenencourage it.
These projects boost GDPfigures.
They generate property taxes.

Speaker 2 (09:33):
Even if maybe minimized through loopholes.

Speaker 1 (09:35):
Right and they attract foreign investment,
which most places want.

Speaker 2 (09:39):
And for the developers selling high value
units up front to investors whodon't intend to live there.
Well, it can be simpler thandealing with actual residents
long term leases, maintenanceissues, rent controls.

Speaker 1 (09:51):
Yeah, you sell it, move on.

Speaker 2 (09:53):
So the system as described in these sources, it
kind of relies on the buildingstanding empty.
It functions as the buildingstand empty.

Speaker 1 (10:01):
The emptiness isn't the problem, it's the point A
feature, not a bug.

Speaker 2 (10:05):
It's the market meeting of very specific if
niche demand.
Privacy over practicality,prestige over actual presence.

Speaker 1 (10:14):
So, wrapping this up, what's a big takeaway from
digging into all this?

Speaker 2 (10:18):
I think it's the realization that those dark
windows you see way up high,they're probably not a sign of
failure.

Speaker 1 (10:23):
Not a failed project.

Speaker 2 (10:24):
No, more likely.
They're a quiet, visible markerof a very successful, very
global financial strategy usingultra luxury real estate to
store, to hide, to protect,maybe even flaunt wealth, all
hidden in plain sight.

Speaker 1 (10:38):
So the next time you're looking up at one of
those gleaming towers at nightand it seems strangely dark.

Speaker 2 (10:43):
Don't just wonder who lives there.

Speaker 1 (10:44):
Based on these sources.
Maybe the better question toask yourself is whose money is
this hiding?